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Sugarcane farmers will profit from beans

Bitange Ndemo
Bitange Ndemo  NATION MEDIA GROUP

The Nairobi Innovation week was a success. The exhibition provided the University of Nairobi with an opportunity to showcase and demonstrate the latest research output. As expected, many people turned up to visit and listen to research presentations.

In the future, this will be the platform where the public and policy makers will witness the latest market trends and the opportunities that lead to innovative products. They will also understand the global dynamics of data, which will hopefully help them to make informed local decisions.

There was a lot to learn. For example, soil scientists showcased new skills that help determine which crops to grow where. It even became clear that the debate on sugar should never have escalated if scientists had been consulted.

Those who paid keen interest may have picked the big picture of agricultural research. I learnt new things in the agricultural sector by having a chat with some of the professors.

Prof Paul Kimani from the Department of Plant Science and Crop Protection at the College of Agriculture and Veterinary Science caught my attention.

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You not only see the passion with which he presents his research, but there are opportunities in every sentence that this veteran academic utters. Listening to him, you begin to wonder why we are so poor.

He tells me that Kenya consumes more than 700,000 tonnes of dry beans every year but produces about 300,000 tonnes. The deficit of between 400,000 and 450,000 tonnes valued at about $400 (Sh40,400) per tonne comes from east African countries including Ethiopia.

We import about Sh5 billion worth of canned beans from Dubai, South Africa, UK, US, Poland and China. Local producers of canned beans are not able to meet the demand.

From production to canning of beans, opportunities are plenty in the midst of poverty. Clearly, our farming decisions are hardly driven by market intelligence.

Why are we not able to exploit these opportunities and create wealth at the bottom of the pyramid? Our problem emanates from information asymmetry that allows politicians to manipulate information to fit their egos. Very few Kenyans understand the supply chain of any commodity. If we did, we could deal a major blow to poverty.

Kenyans pay more for sugar simply because politicians want us to pay for inefficiency. Time and again, research shows that the sugar belt region could competitively produce beans and earn more than they earn from sugar, but farmers here have been held hostage by the political class. This is where the research community must be firm and help poor citizens to exploit existing opportunities.

There is a compelling reason why we must replace sugarcane with beans. A local data analytic firm, Gro Intelligence, notes that in 2008, the world consumed 144 million metric tonnes (MMT) of sugar.

In 2016, the consumption is expected to exceed 174MMT. Despite this 21 per cent increase in consumption, global exports over this period have only increased by 12 per cent, from 50MMT to 56MMT. In 2017, the European Union (EU) plans to eliminate sugar production quotas instituted between 2006 and 2009.

If this occurs, the EU is expected to switch from being a net importer of 2.2MMT of sugar to a net exporter of 2.5MMT. This will literary flood the world with cheap beet sugar.

Prof Kimani argues that because most of the world is becoming health conscious and cutting down on meat products as a source of protein and replacing them with beans, the demand for beans is expected to grow exponentially.

For this reason, it makes more sense to begin production of beans around the sugar belt region.

We are lucky that there is so much data to help us build predictive methods for understanding the future. It is not difficult to predict that sugar prices will collapse once the EU quotas are removed.

It will be a catastrophe to Kenyan farmers who have been harangued by their politicians to continue producing an unprofitable crop at very high production costs.

We cannot afford to toy around with lives of so many people while poverty is ravaging the country, as if we cannot read the writing on the wall.

To boost peasant earnings from beans, it will be necessary to discard archaic methods of markets and create modern aggregation centres for farmers to benefit from their output. Further, we must leverage on technology to address supply chain distortions that deny farmers their effective earnings.

George Bernard Shaw said, “We are made wise not by the recollection of our past, but by the responsibility for our future.”

The writer is an associate professor at University of Nairobi’s Business School.

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